Apple will create its own power management chips

Yet another loyal Apple partner is suffering for failing to do what the company told it to do.

Dialog saw its shares plummet by 19 percent after Apple announced that it is designing its own power management chips for next year's batch of iPhones.

Apple has been telling its suppliers that they either have to slash costs or it will develop things inhouse. The policy has already had casualties with graphics chip maker Imagination and led to a monumental spat with Qualcomm.

Jobs' Mob has realised that it is not going to keep its high profits as its iPhone cash cow dies. So what it wants is to push its margins by cutting costs. It has been strong arming its suppliers, many of whom became addicted to Apple’s custom at the expense of developing other customers.

Apple accounted for 74 percent of Dialog's revenue in 2016.

The main power management chip controls an iPhone's charging function, battery management, and energy consumption. Based on Apple's current plan, they are set to replace partially, or around half of its power management chips to go into iPhones by itself starting next year.

Apple's main power management chips for the iPhone, iPad and Apple Watch are now exclusively designed and made by Dialog.

Power management chips are one of the most crucial and expensive components after core processors, modems and memory chips.

The Tame Apple Press claims that by designing its own gear Apple will also be in a better position to integrate software and hardware and to manufacture products that can be differentiated from those of its rivals such as Samsung and Huawei.

It insists that Apple's new in-house power management chip will be the most advanced in the industry and could have processing capabilities that allow it to better monitor and control power consumption among various components.

Quite why this would be the case is anyone’s guess. Apple has no experience in making power management chips, let alone enough experience to be cutting edge.

The only thing that we can be sure of is that its initial efforts will have to use Dialog patents with the new chips churned out cheaply by Taiwan Semiconductor Manufacturing.